South China Morning Post (July 30)
“Prime Hong Kong office rents have seemed to defy the laws of gravity, especially in Central where monthly rents have increased from HK$20 (US$2.56) per square foot in 2003 to almost HK$140 per square foot. In the first quarter, rents were up 6 per cent from a year ago due to supply shortages. Nevertheless we believe that the potential for further core returns is limited, as we are late in the real estate cycle.”
Tags: Core returns, Cycle, Hong Kong, Limited, Office rents, Potential, Prime, Real estate, Supply shortages
IPE Real Assets (September/October Issue)
“Real estate is often said to be a long-term, buy-and-hold asset class for institutional investors. But the success of investments invariably comes down to getting the timing right.” Recently, “a handful of fund managers” have “sold to bigger parties, either fully or partially.” This raises the question whether the latest round of M&A is a signal. Though it is a “possible canary,” there are other reasons for M&A. The prevailing outlook amongst investors and managers is for “a supportive market environment in the short to medium term” and “an extended cycle, albeit a flat one in terms of capital value growth.”
Tags: Asset class, Buy-and-hold, Canary, Extended cycle, Fund managers, Institutional, Investors, M&A, Real estate, Timing, Value growth
Institutional Investor (March 22)
“In 2017, private equity and private debt funds raised $560 billion, 10 percent above what was raised the year before. Real estate investors, however, got the message that valuations may be stretched. Fund raising for property declined to a level last seen in 2013.”
Tags: Debt, Fund raising, Funds, Investors, Private equity, Property, Real estate, Stretched, Valuations
New York Times (January 9)
India’s “man-made currency crisis” has had real costs and limited benefit. Two months after the surprise move to invalidate over 80% of existing currency, “the manufacturing sector is contracting; real estate and car sales are down; and farm workers, shopkeepers and other Indians report that a shortage of cash has made life increasingly difficult.”
Tags: Benefit, Car sales, Contracting, Costs, Crisis, Currency, Farm workers, India, Manufacturing, Real estate, Shopkeepers, Shortage
Wall Street Journal (January 7)
“Does Donald Trump understand business?” He might know real estate and branding, “but the President-elect’s Twitter assaults on auto companies make us wonder if he understands cross-border supply chains, relative business costs, regulatory mandates, or anything else about building and selling modern cars and trucks.”
Tags: Automakers, Branding, Business, Cars, Costs, Cross-border supply chains, Real estate, Regulatory mandates, Trucks, Trump, Twitter
Institutional Investor (July 29)
U.S. REITs have soared on a “torrid rally.” Though the momentum will slow, strong fundamentals should underpin the sector, which is also benefiting from negative interest overseas. “The economy’s seven-year recovery should sustain real estate demand.” Moreover, “banks’ conservative real estate-lending policies in the wake of massive losses during the financial crisis should continue to limit supply.”
Tags: Banks, Demand, Financial Crisis, Fundamentals, Lending, Negative interest, Rally, Real estate, Recovery, REITs, Supply, U.S.
New York Times (July 6)
“The financial strains from Britain’s vote to leave the European Union are starting to show, as worries ripple through the country’s real estate market” causing three real estate funds to suspend withdrawals. Ultimately, “the reverberations could test whether, since the global financial crisis, officials have put in place the necessary measures to protect the broader system from a shock.”
Tags: EU, Financial, Financial Crisis, Funds, Officials, Real estate, Reverberations, Strains, UK, Withdrawals
Institutional Investor (August 4)
“Conventional wisdom isn’t always the wisest.” Conventional wisdom holds that rising interest rates are bad for REITs. This time around, however, REITs “offer value in the face of an interest rate hike. Real estate investment trusts and master limited partnerships are yield plays that should fare well if rates rise gradually.”
Tags: Conventional wisdom, Gradual, Interest rates, MLPs, Real estate, REITs
USA Today (July 30)
“The Chinese government certainly likes to control things. It keeps its currency artificially low to promote exports. It meddles heavily in real estate prices. And it is obsessed with controlling information on the Internet. But nothing has been as jarring to American sensibilities as its recent efforts to prop up stock prices.”
Tags: China, Currency, Exports, Government, Internet, Real estate, Stock prices, U.S.
Institutional Investor (March 10)
“China’s red-hot growth inevitably has to cool given that it has already overbuilt and overborrowed. China’s debt load has exploded four-fold since 2007, largely on the back of shadow banking and a real estate boom.” China’s total debt load (estimated at 282% of GDP by McKinsey) now “tops debt loads in the U.S., Germany, Australia and other developed countries. China’s corporate debt amounts to 125 percent of GDP.”
Tags: Australia, Boom, China, Debt load, GDP, Germany, Growth, McKinsey, Overborrowed, Overbuilt, Real estate, Shadow banking, U.S.
